First-quarter Kumba production hampered by rain, equipment constraints

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Iron ore miner Kumba Iron Ore has revised its production and sales forecast for the year from 39 to 41 million tonnes to between 38 and 40 million tonnes, due to lower production and realized sales during the quarter ended. March, 31st.

“Seasonal weather events and equipment reliability constraints resulted in challenging operating conditions in the first quarter. Given the difficult operating conditions, our production and sales volumes decreased by 21% and 8%, respectively,” Kumba CE Mpumi Zikalala said April 21.

Along with the downward revision to production and sales guidance, Kumba has also revised its Net Direct Cost – or C1 Unit Cost – guidance to $44/t from $41/t previously to reflect the revised production guidance. , as well as inflationary pressure, including higher diesel and explosives costs.

“Advancing our near-term priorities of operational excellence, profitability and realizing the full value of our premium product has become even more important and we are fully focused on improving these priorities,” he said. she declared.

Zikalala said that despite operational challenges, Kumba had delivered a strong safety performance, bringing the company’s fatality-free record to five years and ten months.

For the quarter, production was down 21% year-on-year from 10.6 million tonnes to 8.3 million tonnes due to heavy rainfall and equipment reliability issues caused by ongoing supply issues in spare parts.

These two factors have had an impact on the availability of vegetable raw materials.

Meanwhile, sales were down 8% year-on-year from 10.3 million tonnes to 9.5 million tonnes, due to rail constraints and low levels of stock available at the port of Saldanha Bay in Cape Town. western.

Despite heavy seasonal rainfall hampering operational activities, particularly at the Kolomela mine in the Northern Cape, total waste stripping increased by 6% to 46.7 million tonnes from 44.1 million tonnes during the previous comparable period.

In Sishen, also in the Northern Cape, waste stripping increased by 23% to 35.7 million tonnes from 29.1 million tonnes, which Kumba attributed to the effectiveness of rain preparedness plans put in place. 2021, which included the redeployment of heavy mining equipment to less saturated areas of the mine.

However, this redeployment has had an impact on the availability of plant raw material.

During the period, Kolomela experienced 428 mm of rain, more than double the 207 mm of rain in Sishen. While rain preparedness plans were also in place at Kolomela, the high volume of water proved challenging, leading to a 27% decrease in waste stripping to 11.1 million tonnes from 15.1 million tonnes in the previous comparable period.

In addition to weather-related impacts, Kumba said it continues to experience equipment reliability issues due to the global shortage of spare parts for heavy mining equipment, which the company says was the result of the cumulative effect of Covid-19 and geopolitical disruptions.

As a result, Kumba has focused on implementing its reliability programs and managing the spare parts situation with supply teams and original equipment manufacturers.

Additionally, Kumba said it has deployed additional mining contractor resources as required by its mining plan.

Plant stability was affected by feedstock stresses emanating from the mining challenges encountered. As a result, production at Sishen fell by 18% to 5.8 million tons, from 7.1 million tons a year ago, and Kolomela fell by 29% to 2.5 million tons from 3, 5 million tons.

Critical plant maintenance was brought forward during the period to reduce potential production disruptions in the future as ore supply increases, Kumba said.

Meanwhile, ore transported by rail at the port fell 1% year-on-year, from 9.2 million tonnes to 9.1 million tonnes. This, combined with lower production volumes, resulted in a one million tonne decrease in closing finished inventory of 5.1 million tonnes, from 6.1 million tonnes, with 4.3 million tonnes held. in the mines.

The railway line was also affected during the period by extreme weather conditions, which led to washouts. Continued locust invasions in the Northern Cape region also hampered operations.

Due to rail constraints and low stock levels at the Saldanha Bay port, export sales were down 7% year-on-year, from 10.2 million tonnes to 9.5 million tonnes.

“We continue to work closely with Transnet to improve the efficiency of the line,” concluded Kumba.

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